Shell-shocked by the sanction | Latest news The Moscow Post
31 January 2023

Shell-shocked by the sanction

Germany, for the sake of the political interests of its leaders, is ready to leave its population without energy supply.

German Chancellor Olaf Scholz considers it unlikely that the second line of the Nord Stream-2 gas pipeline will be commissioned. He expressed his point of view in an interview with Focus magazine published on Sunday. "I think it's hard to imagine," Scholz said when asked if the remaining Nord Stream 2 line would be put into operation. At the same time, he stressed that the wall around Europe would not be erected.

Russian President Vladimir Putin, speaking at the Russian Energy Week in October, said that Russia is ready to start supplying gas to Europe along the surviving Nord Stream-2 pipeline line, including supplying additional volumes. The head of state stressed that "the ball is on the side of the EU."

German investigators, Forbes wrote back in October, concluded that the accidents on the gas pipelines were the result of sabotage. According to The Wall Street Journal, they could not identify those involved in the explosions, but some German officials suspected Russia, believing that Moscow wanted to force Berlin to certify the work of the surviving Nord Stream 2 thread.

Earlier, Nord Stream AG reported "unprecedented destruction" that occurred on September 26 "on three lines of the Nord Stream and Nord Stream-2 offshore gas pipelines. The desire to get to the bottom of the truth in this story stumbles upon the reluctance to allow Moscow to investigate, to bring it to the end.

Press Secretary of the President of the Russian Federation Dmitry Peskov noted that the results of the search for those responsible for the destruction of the European energy infrastructure would surprise many in Germany and Denmark with Sweden.

When the road to "ward No. 6"

Germany is losing its mind - and without formal conclusions, it was clear who benefited from sabotage. But this is only one of the signs of dementia of the German elite, there are others. Three decades after the takeover of the GDR, Germany received a rare opportunity to dominate the European economy and politics, became close to Russia and China, but lost its benchmarks.

Having succeeded in exporting high-quality products and technologies and dependent on external sources of raw materials and fuel, Germany led the EU's movement to the East, trying to gain control over Ukraine. Having succeeded in this, she herself became a victim of intrigue both in the European Union and in its Anglo-Saxon framing. Berlin had to retreat or prepare to leave the achieved frontiers.

The first of them is strategic interaction with Russia in the field of hydrocarbons. The second line is developed economic ties with China. Both of these "strings" fell out of the web, which was woven in Washington.

In the issue of resuming the work of the surviving Nord Stream-2 thread, the German authorities have nothing to say yet. In a recent interview with Spiegel magazine, ex-Chancellor Angela Merkel said: "I would like a calmer time after leaving, because I did a lot of Ukraine. What happened came as a surprise. Minsk agreements did not work. After the meeting of Presidents Biden and Putin, I and Macron wanted to create an independent European format for discussion with Putin in the EU Council. Some objected and I didn't have the strength to stand up for my point because everyone knew I was going to have to leave office in the fall. "

Beautiful words, especially from the lips of a politician who has done so much to tear Ukraine away from Russia. Merkel believes that it will still be necessary to resume relations with Moscow, but how and when? Berlin by all means expanded the borders of the EU, but it itself faced a loss of influence in this diversity of interests. "There was no force" meant only that Eastern European members of the EU stood in its way, taking on the role of "Trojan voice." The Anglo-Saxons had already gained political control over Europe and the Germans had to obey the rules.

Then for a long time there was a dialogue with Washington about the fate of Nord Stream 2. Closing this issue, Berlin continued discussions on how, applying sanctions in the field of energy, not to harm its interests. High energy prices undermined industrial interests.

On the other hand, it is also difficult to find traces of rationality in the actions of the current German coalition government. In particular, readers of the German edition of Welt were outraged by the words of Chancellor Olaf Scholz, who said that Germany wants to stop the purchase of Russian oil.

The oil embargo was part of the sixth package of anti-Russian sanctions, which the European Union approved in June. It will be introduced gradually: from December 5 - for oil transported by sea (but the pipeline does not fall under restrictions), from February 5 - for oil products. In addition, the EU is considering setting a ceiling for Russian oil prices. There is no agreement on this issue yet, but oil from the Russian Federation may stop coming if it is.

A statist or a sacred victim?

Further, everything developed according to a scenario in which Germany was assigned the role of an extras, and possibly a sacred sacrifice. Although the construction of Nord Stream 2 was completed, Olaf Scholz's office blocked the start of its work. Then, three threads of the four built were blown up altogether. Perhaps in order to close Berlin any opportunity to change my mind.

Germany has been planning a sharp increase in the share of liquefied natural gas (LNG) in gas imports for a long time, but not on the scale required by sabotage on gas pipelines. The process of replacing Russian pipeline gas with LNG has been launched, but this does not solve the problem.

The first terminal vessel (FSRU Neptune) to receive LNG and transfer it to a gaseous state arrived in the Baltic Sea and will continue to the port of Lyubmin. There will be a connection of this terminal with the gas transmission system. FSRU's capacity will be 4.5 billion cubic meters of gas per year.

According to Uniper, two other smaller terminals - Transgas Force and FSRU Transgas Power have a total capacity of up to 7.5 billion cubic meters with a storage volume of 174 thousand cubic meters each. Germany has entered into an agreement for the fifth FSRU, which will be in the port of Wilhelmshaven. The world today has 48 floating terminals, some installed in Lithuania, Italy, Croatia and Turkey. It is easy to calculate that more than two dozen FSRUs will be required to completely replace the four lines of the two Nord Stream gas pipelines!

The total annual capacity of all five terminals will be 33 billion cubic meters of gas. This is a third of the capacity of the four strings of the Northern Flows. The acquisition and maintenance of these LNG terminals will cost 6.5 billion euros per year. The budget for 2022 provides 2.9 billion euros for these purposes, Spiegel said.

Moreover, gas prices today are six times higher than those that for many years existed in relations between Germany and Gazprom and four times higher than domestic gas prices in the United States today. "The fact is that if you look at it soberly, the US benefited the most from the conflict: they sell gas at inflated prices and increase arms supplies," said one top official. But not only. Americans squeeze German products out of the market, contribute to the migration of leading German companies to the United States.

China and the "green transition" deadlocks

Merkel's policies were mostly riddled with pragmatic interests. The approaches of the current coalition towards Russia and China are built on "values." The United States is putting pressure on the Scholz government in order to break off relations with the Russian Federation and measure the ardor of German companies in relation to the PRC.

Olaf Scholz agrees, but adds that "diversification does not mean abandoning ties with China." So far, the German economy is more dependent on China than vice versa. There is a fear that, overcoming dependence on Russian energy, Germany is becoming dependent on China.

Today, more than five thousand German companies operate in China, which provide about 1.1 million jobs in Germany. But breaking economic ties, or even dosing them, could be a ruinous step for German companies in China, which will affect German consumers as well.

Raw materials and components imported from the PRC and used in critical technologies, including solar and wind power equipment, are of critical importance. In some ways, China is difficult to replace in German green transition programs, especially in areas such as lithium batteries and rare earth metals.

This contradicts plans to accelerate the transition to renewable sources.

We add to this that China is also the most important market for German companies.

Industry loss on the horizon

The German business model is under enormous stress, said Tanya Gönner, CEO of the Federal Association of Industry of Germany (BDI), to Welt am Sonntag. Germany expects deindustrialization, every fourth enterprise can leave the country. In addition, Washington allocates almost $370 billion in subsidies under the law "On reducing inflation," promotes the slogan "Do in America."

The Biden administration's green subsidies and tax breaks threaten to destroy European industry, primarily German. The Inflation Reduction Act provides for the expansion of subsidies for the purchase of electric vehicles collected there and with local batteries.

The EU called this step discriminatory, inconsistent with WTO standards and unfriendly. France and Germany must determine what the answer should be, but have not yet been able to agree. Europe, while continuing to insist on compliance with WTO rules, does not notice how it is quietly robbed.

The coming winter could make adjustments to Germany's LNG transition strategy, shake hopes for renewable sources, and expose the reefs on which the German economy sits. But Olaf Scholz's government continues to push the climate agenda. It is hoped that the Climate and Transformation Fund will help finance projects aimed at combating warming, improve the country's energy security. The money is allocated large, but the already achieved frontiers of Germany have to be left. And the conscious rejection of the policy of reasonableness has yet to be paid.

Photo: Nord Stream 2 AG Press Service/Getty Images

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